Recently, a global software client e-mailed us that a prominent industry analyst was demanding certain proof points for a major change in sales strategy that the vendor had just announced. The information demanded was something that this particular software company has a policy of not releasing. Our client was very frustrated and felt that the analyst was being dogmatic and unreasonable.
Frankly, we would have asked for similar proof points if we were in the analyst’s position. The vendor shouldn’t take the demand personally, as even a moderately skeptical analyst should say “ok, nice idea but how are you going to do it?” A good analyst will always peel back the onion to see if there is any credibility to the plan. Our criticism of the analyst lies in not searching for or accepting alternative proof points to support the vendor’s claims.
Talk is cheap — many vendors announce grandiose schemes with no plans to invest in the necessary resources to execute those plans. Another common mistake vendors make is grossly underestimating the work required to implement a particular plan. Sometimes they frankly don’t understand what they need to do in order to be successful. Yet another issue is they’re ignoring the internal political and cultural realities of making a major change.
There are multitudes of real-life examples we could list where vendors wanted analysts to accept something at face value. One of the values that analysts provide to IT buyers is risk management. In order to provide good advice about what to buy or how to implement it an analyst must have sufficient and believable data about the chances of success. Analysts would have egg on their faces if they publish a report merely based on what the vendor said without demanding substantial proof points. It only takes a few experiences of publishing research based on vendor’s statements – and then having it blow up in your face – for an analyst to become cynical, skeptical, quizzical, distrustful, suspicious, hostile, an inquisitor, and any other descriptors you care to add.
However all is not lost. Use this type of a situation as an opportunity to work with the analyst to determine what they really require or what could be supplied as an alternative set of proof points.
SageCircle Technique:
- Arrange a conference call between the analyst and the most senior executive for the business unit making the announcement
- Even though exact numbers cannot be given, the executive should be prepared to talk ranges or other surrogates
- Talk about the complexity of making such a change
- Demonstrate that you know the extent of the challenges
- Be prepared to talk about the tactical plan and calendar milestones. The more detail the better (e.g., each sales rep is going to receive 17.5 hours of classroom instruction in three blocks over a five-week period with 10 units of online learning tracked by this training software
- Be candid about uncertainties
- If there are issues that have not been decided, enlist the analyst in providing insight into tackling these problems
- Arrange follow-up calls at each of the milestones to demonstrate execution and build credibility
Bottom Line: Vendors need to negotiate with analysts on the type of proof points needed to support a vendor announcement. Sometimes it will be necessary to take a deep breath and be calm whenever an analyst makes what appears to be an outrageous demand. This is a negotiation; always push the discussion further by exploring different proof points and other ways to meet the analyst’s needs.
Question: AR – What has been your successful or unsuccessful techniques for dealing with analyst demands for proof points you cannot provide?
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